Preliminary MNB data indicate Q3 drop in external financing capacity
Hungaryʼs net external financing capacity slightly exceeded EUR 1.4 billion in the third quarter of 2017, dropping from an all-time quarterly peak of EUR 3.1 bln in Q2 and from a year earlier, state news wire MTI calculated from monthly preliminary balance of payment data published Tuesday by the National Bank of Hungary (MNB).
The net external financing capacity rose to EUR 867 million in September as the trade of goods shifted back in the black. The improvement on the current account more than offset the drop in European Union capital transfers.
The monthly current account surplus widened to EUR 606 mln in September. It reached a preliminary EUR 816 mln in the third quarter, which was just half of the Q2 surplus of EUR 1.8 bln and was even more sharply down from the EUR 2 bln surplus a year earlier.
The trade of goods showed a surplus of EUR 506 mln in September after two months of unusual deficits. Exports started to rebound already in August, with the end of the scheduled summer shutdowns, and rose further in September.
The Q3 goods surplus came to EUR 344 mln, one third of the surplus in Q3 2016, the preliminary figures indicate.
The monthly surplus in services rose slightly from August to EUR 596 mln. The tourism surplus rose to EUR 337 mln as Hungarians spent less abroad with the end of the summer holidays.
The quarterly services surplus widened to EUR 1.86 bln in Q3 from EUR 1.7 bln in Q2, but was EUR 200 mln lower than one year earlier.
Net (and gross) capital transfers from the EU dropped to EUR 262 mln in September, after jumping to EUR 341 mln in August from practically nil in July.
Capital inflow from the EU totaled EUR 608 mln in July-September, down sharply from EUR 1.4 bln in the second quarter but up from EUR 165 mln one year earlier. Overall net transfers from the EU totaled EUR 323 mln in September, and reached a preliminary EUR 913 mln in Q3, less than half of the Q2 total. They were sharply up from a low base one year earlier, which was still subdued by the recess between the end of the previous and the start of the new EU budget period.
The monthly financial account indicates that the Hungarian government paid out some EUR 280 mln in advances to successful applicants of EU funding, as opposed to July-August when such government receivables from the EU dropped EUR 372 mln.
At the same time, the government continued to transfer already received EU monies to the ultimate recipients, reducing its debt to them by a combined EUR 480 mln in the third quarter.
The MNB will publish a first reading of Q3 balance of payments data on December 21.
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